"I work for a federal organization which is moving from a traditional bureacratic structure to a matrixed or shared services organization. Internally, we have 4 customers (our operational lines of business) and we are the support organization, offering administrative and operational support. The 4 customers' directors work with our ""service center"" director in a collaborative fashion - no single director takes precedence over another. Does anyone out there have any experience in this area? "

Don't know how much helpI can be! The company I work for is called Seale Air Corporation. It has a matrix management structre. So I have some experience in this model of management. I am happy to have an offline discussion about your specific concerns or issues.

Hi Cindy, that's a unique structure. I think it will require a novel solution. I have come across a distributed governance model once before, so here are my thoughts: 1. Accountability is the key to governance, so each director will need to accept responsibility and accountability for an aspect of the organisation's governance requirements. This is in addition to their regular duties. 2. They will need to report to the Directors group on how they're managing that governance requirement (eg. audits, inventory monitoring, HR health, etc) on a scheduled basis. 3. Assessing governance requirements will need to be a collaborative requirement with all the directors, so they'll need to devote some time to producing a list that identifies the total group governance requirements. That's a simple overview but provides a basis to continue modelling using your organisation's unique structure and personalities.

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David_Alman

March 26, 2010 03:53 AM

Hi Cindy
I believe your upcoming experience is not unusual and therefore you should get a number of reasonable responses. Your restructure appears similar(?) to an Australian State Government shared services arrangement I experienced some years ago. In that case the shared service formula was being rolled out and trialed but had similar governance arrangements and serviced some 5 agencies, of which one was mine. I think it relies on goodwill and collaborative working relations, and that is not always easy when demand for services (at low relative cost) stretches you thin.

The upside is that good relationships can be developed between regular users and providers and operational services can be streamlined and costs contained.

The downsides were:
> My HRM system was replaced by SAP, and HR computer costs quadrupled and I thought that was unnecessary. A distinction not always recognised is that HR often seeks adhoc reports to analyse and report on issues, so provision of such reports remain relevant (this differs from, say, finance who are used to standardised reporting).
> There was an emphasise on shared service agreements that were product and cost focused, and monthly reporting. Again I thought this was unnecessary, exception reporting is fine by me.
> What I sought was, additionally, a regular qualitiative report: Opinions and implications on issues such as investigations, employee enquiries or complaints. This was very difficult to get the providers at an operational level to understand and do. The reason for this is that leaving strategy and policy (and some other sensitive matters) in the Agency HR, in effect, ""beheads"" an HR Function. So it is essential to get feedback on issues and trends that may require revision of policy or strategy.
> The triangle between senior management who want personalised and confidential services relevant to the agency, senior agency HR, and service providers can cause tension. So maybe in your formula all HR, including directors, is taken across which would prevent agency HR potentially trying to build up their numbers and services that end up causing duplication.
> In this model another downside was that development and promotion of shared service agency staff was challenging because those more senior positions were retained within the agency HR areas.

I left soon after, though from what I hear there has been a rollback of shared services into agencies, who in turn have been merged into larger agencies.